As part of the collection activity, the security deposit amount paid upfront during the lease contract can be used to adjust the arrears on the account by posting the Security Deposit Adjustment transaction.

Before posting the transaction, ensure that the security deposit balance is adequate to adjust the arrears. Else, system displays a validation error indicating Insufficient Security Deposit amount to adjust.

On posting the transaction, system adjusts the balances based on either spread matrix or the spread defined at contract. On successful posting of transaction, the Security Deposit amount is adjusted on the account as a payment and Late Fee (if any) will be eligible for reversal. The ‘Results’ section displays the status of transaction and indicates previous and current Security Deposit Amount on the account.

A letter of intimation is generated for correspondence by the scheduled batch LCSTXN_BJ_121_01 (LETTER FOR LEASE MONETARY TXNS) which consists of Transaction Date, Security Deposit Amount before and after adjustment, and comments if any.

You can also reverse the security deposit adjustment by posting Security Deposit Adjustment Reverse transaction and system automatically reverses the balance of transaction amount to the Security Deposit Amount. However, on reversal letter is not generated and has to be manually intimated.